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Africa’s Development Dynamics 2019 #AfricaDynamics2019

8. Januar 2020 - 12:33
Competitive firms and committed governments are the catalysts of the continent’s economic transformation

African firms are the key to the economic transformation of the continent, but they need governments to create better conditions for them to thrive, according to the second edition of the African Union Commission’s (AUC) economic report produced in collaboration with the OECD Development Centre. Without bold policy changes, most African businesses may not be ready for reaping the benefits of the African Continental Free Trade Area Africa (AfCFTA) which is projected to offer African firms the new opportunities of a 1.2 billion consumers strong continental market.

Africa’s Development Dynamics (AfDD) 2019, released today, shows that Africa’s expanding domestic markets offer great opportunities for transforming production systems across the continent. Africa recorded 4.6% annual gross domestic product (GDP) growth between 2000 and 2018; with domestic demand accounting for 69% of it. The continent’s growth is projected at 3.6% in 2019 and should remain robust at 3.9% between 2020 and 2023. The regional demand for processed food has been growing 1.5 times faster than the global average. Large Pan-African firms and some dynamic start-ups are seizing these opportunities to grow, as highlighted in the report.

However, the report finds that Africa needs more dynamic enterprises to turn these opportunities into higher profits, more investment and new, decent jobs. This is especially true of small and medium enterprises in employment-intensive sectors:

  • Firms fail to tap the growth in neighbouring markets: exports of consumption goods to other African markets decreased from 0.8% of Africa’s GDP in 2009 to 0.5% in 2016. Currently, most African firms are losing out to new competitors both at home and in emerging markets. Only 18% of Africa’s new exporters survive beyond three years.
  • Productivity is not catching up. Since 2000, Africa’s average labour productivity has stagnated at around 12% of US levels. The Africa-to-Asia labour productivity ratio has decreased from 67% in 2000 to 50% in 2018.

“Accelerating the development of Africa’s productive sectors is critical to meeting the objectives of the African Union’s Agenda 2063. We must shake the structure of our economies to create strong, robust and inclusive growth, with new jobs and opportunities for all”, said H.E. Prof. Victor Harison, Commissioner for Economic Affairs of the AUC, while launching the report. Progress in quality job creation is too slow: in some countries, almost 91% of the workforce outside of the agricultural sector remains in informal and vulnerable employment.

AfDD 2019 puts forward a systemic approach to productive transformation by focusing on three sets of policies:

  • Develop effective clusters of firms, by providing them with business services that improve specialisation in niches, reinforce linkages between the most productive ones and the others, and address skill shortages.
  • Encourage the creation of regional production networks to generate economies of scale between African countries, attract new investors, develop complementarities within the value chains, and avoid a competitiveness race to the bottom.
  • Enhance firms’ abilities to thrive in new markets. Policies can provide extra support to exporters by removing non-tariff barriers to the continental trade, simplifying administrative procedures and custom services, and improving connective infrastructure – especially flights, roads and ports.

“The entry into force of the African Continental Free Trade Area in 2019 marks a strong commitment by African leaders towards productive transformation. But it will work if African firms are strong enough to compete in this new, enlarged market. They need bolder and smarter government policies to support them”, stated Mario Pezzini, Director of the OECD Development Centre and Special Advisor to the OECD Secretary-General on Development.

The report provides detailed analysis and recommendations for each of the five African regions.

AUC/OECD (2019), Africa’s Development Dynamics 2019: Achieving Productive Transformation, OECD Publishing, Paris/AUC, Addis Ababa, https://doi.org/10.1787/c1cd7de0-en.

To consult Africa’s Development Dynamics 2019, visit https://oe.cd/afdd2019

Also available in: FrenchPortuguese

DOWNLOAD THE STATISTICAL ANNEX

Statistical annex to Africa’s Development Dynamics 2019 (features most recent data): Excel

Extended statistical annex, including statistical indicators back to 2000 : Excel

Metadata:

  • Data dictionary of indicators: ExcelCSV
  • Data dictionary of country and country groupings: ExcelCSV
  • Country membership in country groupings: Excel
  • List of indicators, with descriptions and sources: Excel

Click here to access the data portal for the Statistical Annex

Published on November 05, 2019

Kategorien: english

2019 Human Development Report says business as usual will not solve new generation of inequalities #HDR2019

9. Dezember 2019 - 13:58
“Beyond income, beyond averages, beyond today: inequalities in human development in the 21st Century”

UNDP’s 2019 Human Development Report (#HDR2019) argues that a new generation of inequalities is opening up, around education, and around technology and climate change which could trigger a ‘new great divergence’ in society. For example, in countries with very high human development, subscriptions to fixed broadband are growing 15 times faster and the proportion of adults with tertiary education is growing more than six times faster than in countries with low human development.

Inequalities are entrenched in our societies. Parents’ advantages in income, health and education shape their children’s lives, often leading to “hoarding” of opportunities across generations, the report shows. For example, children in professional families in the United States are exposed to three times as many words as children in families receiving welfare benefits, with a knock-on effect on test scores later in life.

“Different triggers are bringing people onto the streets — the cost of a train ticket, the price of petrol, demands for political freedoms, the pursuit of fairness and justice. This is the new face of inequality, and as this Human Development Report sets out, inequality is not beyond solutions,” says UNDP Administrator, Achim Steiner.

The 2019 Human Development Report (HDR), entitled “Beyond income, beyond averages, beyond today: inequalities in human development in the 21st Century,” says that just as the gap in basic living standards is narrowing for millions of people, the necessities to thrive have evolved.

A new generation of inequalities is opening up, around education, and around technology and climate change – two seismic shifts that, unchecked, could trigger a ‘new great divergence’ in society of the kind not seen since the Industrial Revolution, according to the report. In countries with very high human development, for example, subscriptions to fixed broadband are growing 15 times faster and the proportion of adults with tertiary education is growing more than six times faster than in countries with low human development.

“What used to be ‘nice-to-haves’, like going to university or access to broadband, are increasingly important for success, but left only with the basics, people find the rungs knocked out of their ladder to the future,” argues UNDP’s Pedro Conceição, Director of the HDR Office, which pioneers a more holistic way to measure countries’ progress beyond economic growth alone. The report analyzes inequality in three steps: beyond income, beyond averages, and beyond today. But the problem of inequality is not beyond solutions, it says, proposing a battery of policy options to tackle it.

Thinking beyond income The 2019 Human Development Index (HDI) and its sister index, the 2019 Inequality-Adjusted Human Development Index, set out that the unequal distribution of education, health and living standards stymied countries’ progress. By these measures, 20 per cent of human development progress was lost through inequalities in 2018. The report, therefore, recommends policies that look at but also go beyond income, including:

  • Early childhood and lifelong investment: Inequality begins even before birth and can accumulate, amplified by differences in health and education, into adulthood. For example, children in professional families in the United States are exposed to three times as many words as children in families receiving welfare benefits, with a knock-on effect on test scores later in life. Policies to address it, therefore, must also start at or before birth, including investing in young children’s learning, health and nutrition.
  • Productivity: Such investments must continue through a person’s life, when they are earning in the labour market and after. Countries with a more productive workforce tend to have a lower concentration of wealth at the top, for example, enabled by policies that support stronger unions, set the right minimum wage, create a path from the informal to the formal economy, invest in social protection, and attract women to the workplace. Policies to enhance productivity alone are not enough, however. The growing market power of employers is linked to a declining income share for workers. Antitrust and other policies are key to address the imbalances of market power.
  • Public spending and fair taxation: the report argues that taxation cannot be looked at on its own, but it should be part of a system of policies, including public spending on health, education, and alternatives to a carbon-intensive lifestyle. More and more, domestic policies are framed by global corporate tax discussions, highlighting the importance of new principles for international taxation, to help ensure fair play, avoid a race to the bottom in corporate tax rates, especially as digitalization brings new forms of value to the economy, and to detect and deter tax evasion.
Looking beyond averages

Averages often hide what is really going on in society, says the HDR, and while they can be helpful in telling a larger story, much more detailed information is needed to create policies to tackle inequality effectively. This is true in tackling the multiple dimensions of poverty, in meeting the needs of those being left furthest behind such as people with disabilities, and in promoting gender equality and empowerment. For example:

  • Gender equality: Based on current trends, it will take 202 years to close the gender gap in economic opportunity alone, cites the report. While the silence on abuse is breaking, the glass ceiling for women to progress is not. Instead, it is a story of bias and backlash. For example, at the very time when progress is meant to be accelerating to reach the Sustainable Development Goals (SDGs) by 2030, the report’s 2019 Gender Inequality Index says progress actually is slowing.

A new “social norms index” in the Report says that in half of the countries assessed, gender bias has grown in recent years. About fifty per cent of people across 77 countries, said they thought men make better political leaders than women, while more than 40 per cent felt that men made better business executives. Therefore, policies that address underlying biases, social norms and power structures are key. For example, policies to balance the distribution of care, particularly for children, are crucial, says the report, given that much of the difference in earning between men and women throughout their lifecycle is generated before the age of 40.

Planning beyond today Looking beyond today, the report asks how inequality may change in future, looking particularly at two seismic shifts that will shape life up to the 22nd century:

  • The climate crisis: As a range of global protests demonstrate, policies crucial to tackling the climate crisis like putting a price on carbon can be mis-managed, increasing perceived and actual inequalities for the less well-off, who spend more of their income on energy-intensive goods and services than their richer neighbours. If revenues from carbon pricing are ‘recycled’ to benefit  taxpayers as part of a broader social policy package, the authors argue, then such policies could reduce rather than increase inequality.
  • Technological transformation: Technology, including in the form of renewables and energy efficiency, digital finance and digital health solutions, offers a glimpse of how the future of inequality may break from the past, if opportunities can be seized quickly and shared broadly. There is historical precedent for technological revolutions to carve deep, persistent inequalities – the Industrial Revolution not only opened up the great divergence between industrialized countries and those who depended on primary commodities; it also launched production pathways that culminated in the  climate crisis.

The change that is coming goes beyond climate, says the report, but a ‘new great divergence’, driven by artificial intelligence and digital technologies, is not inevitable. The HDR recommends social protection policies that would, for example, ensure fair compensation for ‘crowdwork’, investment in lifelong learning to help workers adjust or change to new occupations, and international consensus on how to tax digital activities – all part of building a new, secure and stable digital economy as a force for convergence, not divergence, in human development.

“This Human Development Report sets out how systemic inequalities are deeply damaging our society and why,” said Steiner. “Inequality is not just about how much someone earns compared to their neighbour. It is about the unequal distribution of wealth and power: the entrenched social and political norms that are bringing people onto
the streets today, and the triggers that will do so in the future unless something changes. Recognizing the real face
of inequality is a first step; what happens next is a choice that each leader must make.”

Download Human Development Report 2019 English French Spanish
Kategorien: english

Launch of global student-led initiative “Economists for Future” #Economists4Future

28. November 2019 - 15:23
Student movement urges economists to step up to tackle the climate crisis

[Madrid, November 28] In the build-up to the international climate strikes ahead of COP25, students from across the globe are calling upon the economics community to raise its game and devise a more impactful contribution to tackling the climate crisis. So far, the overall contribution from economists has been nowhere near commensurate with the magnitude of the problem. The international initiative “Economists for Future” is launching today with the ambition to change that. Find the open letter here.

Sieh dir diesen Beitrag auf Instagram an

Economists for Future is a global student-led movement calling on the economics community to raise its game and devise a more impactful contribution to tackling climate change. Let’s unite the economic community and sign the open letter here: econ4future.org #economists4future #changeiscoming #economistsunite #actnow #stepup #sign4change The video was produced by @flx.m3dia

Ein Beitrag geteilt von Economists for Future (@economists4future) am Nov 28, 2019 um 5:11 PST

Economists are letting down the world on climate change

Every year, millions of young people embark on studying economics to help equip them to improve the state of the world. Yet, their education is failing to prepare them to tackle the greatest challenge of the century: the climate crisis. In most textbooks, the economy is detached from any ecological foundations. For example: climate change, the vulnerability of ecosystems and the unsustainability of bottomless resource consumption are largely ignored. The economists of the future must be fit for the context they serve in – they must learn to embed their thinking and methodologies within the context of a finite planet.

The situation in research is no better. The most-cited journal in economics, the ‘Quarterly Journal of Economics’, has never published an article on climate change. Of approximately 77,000 articles published in top economics journals, less than 0.1% address climate change. Even when economists do engage with the climate challenge, they often distort the problem. They include models that systematically underestimate risks, ignore crucial parameters like the value of biodiversity and do not reflect the potentially irreversible tipping points. These journals set a precedent for the rest of the discipline and their de-prioritisation of climate change is a matter of deep concern. One that is not just failing students but humanity too.

Students are taking responsibility, now they are calling on economists to do the same

“As students of economics we won’t stay quiet when our discipline is letting down the world” says Marc Beckmann, one of the organisers for “Economists for Future”. The open letter has been crafted by a small group of economics students from across the world that came together out of sheer frustration at the moral and analytical failure of the discipline they planned to commit their lives to. Across the world, students and economists are rising up and supporting this movement.

While it is true that some economists have had a significant contribution, overcoming this problem is going to require a response from right across the discipline. It is going to require economists to go beyond their academic silos and speak out in public about the consequences of climate inaction.

Economists can and must step up and help facilitate the zero-carbon transition towards a more prosperous and equitable world. Young people are taking responsibility for their future, it is time economists do the same.

 

Sam Butler-Sloss, student of Economics at the University of Edinburgh and an organiser for “Economists for Future”: “Economists say they take the climate science seriously. But the climate emergency has no time for empty words. It is very simple, if you take the climate science seriously then act accordingly: put it in our education, put it in the top journals, show leadership. As a student, there are many economists that I look up to for leading the way but there is no doubt that as a community they must go far further, faster.”

Philemon Ronoh, an organiser for “Economists for Future”: “In Kenya, climate change is already having a significant and negative effect on our lives and livelihoods. This is not a distant threat–this is now. This is one of the greatest global injustices we have ever seen. Economists have to be part of the solution or history will judge them harshly.”

Marc Beckmann, student of “Politics, Psychology, Law and Economics (PPLE)” at the University of Amsterdam and an organiser for “Economists for Future”: “What is ironic is that the economic discipline has been hammering home for several decades that they are ‘scientific’ while deprioritising the most important science of our day. Natural scientists have set out a clear case for economic transformation. Now as social scientists, we must in our field lay out a pathway that makes this transformation, at the speed the science demands, more achievable.”

 

 

Kategorien: english